Money Saving Expert Mortgages Mortgage Calculator

This mortgage calculator helps you estimate your monthly repayments, total interest paid, and affordability based on your mortgage amount, interest rate, and loan term. It's designed to provide a quick overview of different mortgage options without financial advice.

How the Mortgage Calculator Works

The calculator uses the standard mortgage repayment formula to determine your monthly payments. The formula accounts for the principal amount, interest rate, and loan term to provide an accurate estimate.

Mortgage Repayment Formula

Monthly Payment = P × [r(1 + r)^n] / [(1 + r)^n - 1]

Where:

P = Principal loan amount
r = Monthly interest rate (annual rate divided by 12)
n = Number of payments (loan term in years × 12)

The calculator also calculates the total interest paid over the life of the loan by comparing the total repayment amount to the original loan amount.

How to Use This Calculator

Enter the total mortgage amount you're borrowing.
Input the annual interest rate (APR).
Select the loan term in years.
Click "Calculate" to see your estimated monthly payment and total interest.
Use the "Reset" button to clear all fields and start over.

Important Notes

This calculator provides estimates only. Actual payments may vary.
Results are based on the assumptions shown in the calculator.
For precise mortgage advice, consult a financial advisor.

Worked Example

Let's calculate a mortgage with these parameters:

Mortgage amount: £200,000
Annual interest rate: 4.5%
Loan term: 25 years

Calculation Steps

Convert annual rate to monthly: 4.5% ÷ 12 = 0.375% or 0.00375
Calculate number of payments: 25 × 12 = 300
Apply the formula: £200,000 × [0.00375(1 + 0.00375)^300] / [(1 + 0.00375)^300 - 1]
Result: £1,143.45 per month

For this example, the total interest paid over 25 years would be approximately £318,000, meaning you would pay back £518,000 in total.

Types of Mortgages

There are several types of mortgages available, each with different features and requirements:

Mortgage Type	Description	Best For
Fixed Rate	Interest rate remains the same for the entire loan term	Predictable payments and stability
Variable Rate	Interest rate can change over time	Lower initial rates and flexibility
Tracker Rate	Interest rate follows a benchmark rate	Potential for lower rates
Interest-Only	Only interest is paid each month	Cash flow benefits for investors
Offset Mortgage	Interest is paid from an offset account	Lower monthly payments

Choose the type of mortgage that best fits your financial situation and goals.

Frequently Asked Questions

How accurate is this mortgage calculator?

This calculator provides estimates based on standard mortgage formulas. For precise figures, consult a mortgage broker or lender.

What factors affect mortgage repayments?

Key factors include the loan amount, interest rate, loan term, and type of mortgage. Additional fees and insurance may also apply.

Can I change my mortgage term after taking it out?

Some mortgages allow for term changes, but this typically requires approval from your lender and may affect your interest rate or repayment amount.

What is the difference between APR and interest rate?

APR (Annual Percentage Rate) includes all fees and costs, while the interest rate is the actual borrowing cost. APR is usually higher than the interest rate.

How do I find the best mortgage rate?

Compare rates from multiple lenders, consider your financial situation, and check if you qualify for any special offers or discounts.